If you are planning to file for Chapter 7 or Chapter 13 bankruptcy, chances are you receive calls, letters, and other communications from collectors on a regular basis. In addition, you may be the subject of a creditor lawsuit or may have your wages being garnished. All of these collection efforts can weigh heavily on your mind and can bring a lot of stress into your life, especially if you have no ability to pay those debts. In addition, you may be facing repossession of your vehicle or foreclosure of your home.
The good news is that at the time you file your bankruptcy petition, the court will issue an order referred to as an “automatic stay,” as directed by 11 U.S. Code § 362. The automatic stay provides the following protections for you from creditors:
- Stop collection efforts of consumer debts
- Halt foreclosures and repossessions
- Halt lawsuits against you
- Prevent disconnection of your utilities
- Stop evictions
- Prevent utilities from being turned off
- Stop wage garnishments and bank levies
- Stop public agencies from collecting overpayments
All of the above can provide extreme relief for you as you will not have to worry immediately about losing your home, car, or wages and can get some peace from collections.
However, the automatic stay cannot stop every type of collection and the following can proceed throughout your bankruptcy:
- Certain tax collections
- Child support and spousal support collections
- Criminal cases against you
- Pension and IRA loans
Finally, many creditors – especially mortgage lenders trying to foreclose – may ask the court to lift the stay in regard to their debt. It is important to have an attorney handling your case who will fight for the stay to remain in place.
Consult With a St. Petersburg Bankruptcy Lawyer Today
Bankruptcy can have many benefits for many people and households in Florida. If you are struggling to pay your bills and you would like to discuss your legal options, you should not hesitate to contact an experienced bankruptcy attorney at the law firm of Berkowitz & Myer. Consultations are free, so please call us at 727-344-0123.
1http://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-7-bankruptcy-basics
